"We're giving phones to employees at the end of July," an Apple spokesman said Friday ahead of the launch of the device, which combines a cell phone, a Web browser and a music and video player.
Chief Executive Steve Jobs announced the gift in a meeting with employees Thursday. Employees will get the high-end model with 8 gigabytes of storage, worth $600.
"That's the good news. The bad news is that he wants the first wave to go to customers. Employees will probably get their phones at the end of July," said one Apple staffer who declined to be identified.
The total cost would be more than $10.8 million if every full-time employee receives one.
Apple did not say if its 2,400 part-time and contract employees would also receive the phones, or if the company would pay the service costs, which range from $60 to $100 a month from exclusive provider AT&T Inc. (T).